Meralco PowerGen Corporation (MGEN), a power generation investment subsidiary of Manila Electric Company (Meralco) has acquired 86-percent shareholdings of affiliate firm Global Business Power Corporation (GBP) for P34.466 billion.
The stake acquisition by MGEN was carried out through the transfer of the shareholdings of Beacon Powergen Holding Inc. (BEAHI), a wholly owned subsidiary of Metro Pacific Investments Corporation (MPIC); and the interest held by JG Summit Holdings Inc. of the Gokongwei group.
The purchase price of the transferred BEAHI shareholdings had been pegged at P22,443,400,000.00 – and that accounted for its 56-percent equity in GBP.
For the JG Summit shares, the transaction amounted to P12,023,250,000.00 for the 30-percent ownership of the Gokongwei firm in Global Power.
“As a result of the transaction, MGEN will own 100-percent of GBP,” its parent-firm Meralco has stated in a disclosure to the Philippine Stock Exchange.
It was specified that the purchase price “shall be paid in installments based on the following schedule: 60-percent shall be paid at closing; 20-percent will be paid six (6) months after and the remaining 20-percent will be paid after 18 months.”
Tapped as financial advisor to the transaction was AlphaPrimus Advisors; while the legal advisory work was handled by Picazo Buyco Tan Fider & Santos law firm.
At the level of parent firm Meralco, MPIC which is headed by businessman Manuel V. Pangilinan, is the majority shareholder with effective 45.46-percent ownership; while JG Summit has 29.56-percent stake.
“The transaction is subject to customary closing conditions, including regulatory and third party approvals and is expected to close within the first quarter of 2021, barring any circumstances,” Meralco has stipulated.
GBP has aggregate capacity of 1,091 megawatts under its portfolio – and these power generating assets are sited mostly in Visayas and Mindanao grids.
According to Meralco, “the transfer is expected to deliver scale and operational synergy to both GBP and MGen and further enable these companies to provide ample and reliable supply of power to distribution utilities, electric cooperatives and other customers at competitive rates.”
MGen is pursuing several power projects in Luzon – both for thermal and renewable energy facilities that will help meet the country’s future electricity needs.
It is currently advancing to completion its 50MW Powersource First Bulacan Solar Inc project; and it is also targeting to join Meralco’s competitive selection process (CSP) for prospective thermal power development that shall be on stream by year 2024.